#47 S2N: I spy with my little ......

I have been offline for past 48 hours for the festival of Passover, so I have not followed the markets and didn’t want to write about them specifically. However, I still wanted to write a letter (7pm Sydney time) so today will be a slightly different “spotlight” feel.

Today’s Spotlight

Last week I read an article in the Wall Street Journal that I instantly judged as unethical, immoral, dodgy and every other negative adjective. But as time has moved on and I have thought about the article I feel like my original negative views have turned almost 180 degrees. I am not suggesting I have the right take on this, but I wanted to share my thoughts on an issue of morality (I hope you don’t judge me too harshly).

Inside Amazon’s Secret Operation to Gather Intel on Rivals is the name of the article. The story is about a company called Big River that Amazon setup to discover pricing and product journeys of their competitors Walmart, eBay, and other marketplaces. The companies ownership was setup through many intermediaries to hide its true ownership. People working for Big River were never allowed to mention any connection to Amazon. All connection to Amazon was carefully stripped away. Presentations and meeting documents with Amazon executives were never emailed, they were printed and presented in person and shredded at the meetings conclusion. Lawyers briefed Big River staff how to handle any questions about possible linkages to Amazon. As with all things secret, someone eventually leaks and the story comes out.

I love a good conspiracy theory and immediately jumped on the band waggon that Amazon is a baddy up to no good. Let me be clear I have no idea if they contravened any law, so if they did then I am 100% against what they did with no qualification. If they practised corporate espionage within the bounds of law I no longer think they did anything wrong.

Isn’t it good business practise to learn what your competitors are doing, don’t we all do it? I know I have subscribed to a number of newsletters to see what my competitors are doing. Are we practising selective morality because Amazon is one of the largest companies in the world and already so dominant that we think it isn’t fair that they play so hard? Would we bother if it was a not for profit company wanting to learn what its competitors were doing?

Tomorrow we will get back to things more macro, I just felt that it would be worthwhile to explore the idea of morality and its place in business and chew on it for a little and ask ourselves some hard questions. We all have our lines in the sand where we say that is just too far. I think playing the macro game requires asking these types of questions. Sometimes government, central bankers, big business, do things that we find distasteful but sometimes there are no good choices, just least bad choices. With investing and trading one needs to put ones emotions aside and see the big picture.

S2N Observations

When I have been away from the markets I like to look at what I call Price Journey Charts that provide some more colour than static tables, as price journey shows the price action through time and in a snapshot you can have a good feel what has happened. I have included below 2 watchlists with year to date performance. There are more on the site for those wanting to explore.

Performance Review

Chart Gallery

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